G23 - Non-bank Financial Institutions; Financial Instruments; Institutional Investors

• June 9, 2016

  Large Canadian Public Pension Funds: A Financial System Perspective

  Financial System Review - June 2016 Guillaume Bédard-Pagé, Annick Demers, Eric Tuer, Miville Tremblay

  The authors review the eight largest public pension funds in Canada. These funds are an important source of retirement income for Canadians. They are also significant investors, with net assets under management of over $1 trillion. The authors outline the investment strategies of the funds and how they interact with financial institutions and participate in financial markets. They also discuss the ways in which the funds’ risk-management frameworks could contribute to financial system stability and how they minimize potential vulnerabilities.

  Content Type(s): Publications, Financial System Review articles Topic(s): Financial institutions, Financial stability, International financial markets JEL Code(s): G, G1, G11, G2, G23

• On the Nexus of Monetary Policy and Financial Stability: Is the Financial System More Resilient?

  Staff Discussion Paper 2016-12 Patricia Palhau Mora, Michael Januska

  Monetary policy and financial stability are closely intertwined, and the resilience of the financial system carries weight in this relationship. This paper explores whether the financial system is more resilient as a result of the G20’s post-crisis agenda for financial regulatory reform.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Financial stability, Financial system regulation and policies, Monetary policy framework JEL Code(s): E, E5, E52, G, G0, G01, G2, G21, G23, G28

• Measuring Systemic Risk Across Financial Market Infrastructures

  Staff Working Paper 2016-10 Fuchun Li, Héctor Pérez Saiz

  We measure systemic risk in the network of financial market infrastructures (FMIs) as the probability that two or more FMIs have a large credit risk exposure to the same FMI participant.

  Content Type(s): Staff research, Staff working papers Topic(s): Econometric and statistical methods, Financial stability, Payment clearing and settlement systems JEL Code(s): C, C5, C58, G, G2, G21, G23

• Canadian Repo Market Ecology

  Staff Discussion Paper 2016-8 Corey Garriott, Kyle Gray

  This is the first of the Financial Markets Department’s descriptions of Canadian financial industrial organization. The document discusses the organization of the repurchase-agreement (repo) market in Canada.

  Content Type(s): Staff research, Staff discussion papers Topic(s): Financial institutions, Financial markets, Financial system regulation and policies, Market structure and pricing JEL Code(s): G, G1, G18, G2, G21, G23
• June 11, 2015

  Canadian Open-End Mutual Funds: An Assessment of Potential Vulnerabilities

  Financial System Review - June 2015 Sandra Ramirez, Jesus Sierra, Jonathan Witmer

  The authors examine the liquidity and leverage characteristics of Canadian long-term, open-end mutual funds in terms of their potential systemic effects on the Canadian mutual fund sector and on the Canadian financial system more broadly. In their overall assessment of this sector, they consider the regulation, market size and ownership structure of mutual funds in Canada and provide observations about the industry globally.

  Content Type(s): Publications, Financial System Review articles Topic(s): Financial institutions, Financial markets JEL Code(s): G, G2, G23, G28
• December 10, 2014

  Cyber Security: Protecting the Resilience of Canada’s Financial System

  Financial System Review - December 2014 Harold Gallagher, Wade McMahon, Ron Morrow

  Harold Gallagher, Wade McMahon and Ron Morrow examine the various sources of cyber attacks and their potential for systemic risk. Against this background, the report highlights efforts being made to protect against cyber-security threats, including individual and collective actions by financial institutions and financial market infrastructures, as well as initiatives by international organizations, regulatory authorities and governments. The authors then describe the coordination, under the Joint Operational Resilience Management program, of private and public sector actions in Canada for managing and testing capabilities during severe operational events such as cyber attacks.

  Content Type(s): Publications, Financial System Review articles Topic(s): Financial stability, Financial system regulation and policies, Payment clearing and settlement systems JEL Code(s): G, G2, G20, G23, G28

• Search-for-Yield in Canadian Fixed-Income Mutual Funds and Monetary Policy

  Staff Working Paper 2014-3 Sermin Gungor, Jesus Sierra

  This paper investigates the effects of monetary policy on the risk-taking behavior of fixed-income mutual funds in Canada. We consider different measures of the stance of monetary policy and investigate active variation in mutual funds’ risk exposure in response to monetary policy.

  Content Type(s): Staff research, Staff working papers Topic(s): Financial institutions, Monetary policy transmission JEL Code(s): E, E5, E52, G, G2, G23

• To Link or Not To Link? Netting and Exposures Between Central Counterparties

  Staff Working Paper 2013-6 Stacey Anderson, Jean-Philippe Dion, Héctor Pérez Saiz

  This paper provides a framework to compare linked and unlinked CCP configurations in terms of total netting achieved by market participants and the total system default exposures that exist between participants and CCPs.

  Content Type(s): Staff research, Staff working papers Topic(s): Payment clearing and settlement systems JEL Code(s): G, G1, G18, G2, G23

• Consumer Interest Rates and Retail Mutual Fund Flows

  Staff Working Paper 2012-39 Jesus Sierra

  This paper documents a link between the real and financial sides of the economy. We find that retail equity mutual fund flows in Canada are negatively related to current and past changes in a component of the prime and 5-year mortgage rates that is uncorrelated with government rates.

  Content Type(s): Staff research, Staff working papers Topic(s): Financial services, Interest rates JEL Code(s): G, G2, G21, G23

• Vulnerabilities in Defined-Benefit Pension Plans

  Staff Discussion Paper 2007-3 Jack Selody

  An effective pension system enhances economic and financial efficiency. A majority of pension plans in Canada are defined-benefit (DB) plans, but DB plans are under stress from increasing longevity, low long-term interest rates, and the shrinking equity premium. DB plans are vulnerable to such shocks because they are complex financial vehicles, with interdependencies not fully […]

  Content Type(s): Staff research, Staff discussion papers Topic(s): Financial institutions JEL Code(s): G, G2, G23